Multi Commodity Exchange of India shares surged over 3% on Wednesday, hovering near their all-time high following a significant upgrade from Morgan Stanley. The stock touched an intraday high of ₹11,198.00, just shy of its 52-week high of ₹11,218.45, as the global brokerage delivered a substantial target price increase alongside positive earnings revisions.

Morgan Stanley Delivers Major MCX Upgrade With 66% Target Hike

Morgan Stanley has upgraded MCX to Equal Weight from Underweight, delivering a substantial 66% target price increase to ₹11,135.00 from ₹6,710.00. The brokerage's optimistic stance is driven by strong momentum in average daily transaction revenue (ADTR) over the past three months:

The surge in ADTR has been primarily driven by heightened volatility in gold and silver prices, which contributed nearly 55% to ADTR during the period. Morgan Stanley expects this momentum to continue, with the brokerage materially raising earnings estimates and seeing potential upside risks if volatile transaction volumes are sustained.

Strong Market Performance Reflects Bullish Sentiment

MCX shares have demonstrated exceptional market performance, with the stock gaining significant momentum in recent months. The current trading levels reflect strong investor confidence:

The stock's remarkable surge of more than 150% from its 52-week low demonstrates the strong momentum in commodity exchange operations amid increased participation in bullion derivatives and robust volume traction.

Revised Earnings Projections Signal Strong Growth

Morgan Stanley has significantly increased its earnings per share forecasts for MCX across multiple years, reflecting confidence in sustained business momentum:

Despite acknowledging that MCX's valuation remains expensive, Morgan Stanley noted that sustainable ADTR could help normalize valuation multiples over time. At current prices, MCX trades at premium valuations, but sustained transaction revenue could justify these levels.

Key Risks and Market Outlook

While the upgrade reflects strong fundamentals, Morgan Stanley has flagged important risk factors that investors should consider:

The brokerage emphasized that any significant decline in ADTR could lead to rapid profit-taking, especially given that trading revenue data is disclosed on a daily basis, providing high transparency but also potential for increased volatility.

Analyst Consensus and Market Position

Among the 12 analysts tracking MCX, six maintain a Buy rating, five recommend Hold, and one has a Sell call, indicating predominantly positive sentiment. The company's position as India's leading commodity exchange, combined with increased commodity price volatility and growing retail participation in derivatives trading, continues to support the bullish outlook from most market participants.

Shriram Finance Limited has achieved another significant milestone with CARE Ratings Limited assigning the coveted 'CARE AAA; Stable' rating to its Fixed Deposit Programme on December 30, 2025. This development follows the company's earlier credit rating upgrade to 'CARE AAA; Stable' from 'CARE AA+; Stable' for its debt instruments, marking continued recognition of the NBFC's strengthened financial profile post the landmark MUFG Bank partnership.

Latest Rating Assignment

CARE Ratings Limited has assigned the highest credit rating to Shriram Finance's Fixed Deposit Programme, as communicated through an official letter dated December 30, 2025. The company has informed both BSE Limited and National Stock Exchange of India Limited about this rating assignment under Regulation 30 of the SEBI Listing Regulations.

Previous Credit Rating Upgrades

The latest rating assignment builds upon Shriram Finance's recent credit rating enhancement across multiple debt instruments. CARE Ratings had previously upgraded the company's credit ratings after assessing improved financial profile, stronger liquidity position, and reduced leverage following the MUFG transaction.

Strategic Benefits of AAA Rating

The AAA credit rating for Fixed Deposits represents the highest credit rating category, indicating extremely strong capacity for timely payment of financial obligations. This enhancement provides several strategic advantages for Shriram Finance's deposit mobilization efforts.

MUFG Partnership Impact

The rating enhancements follow Japan's MUFG Bank's agreement to acquire a 20% stake in Shriram Finance for approximately ₹40,000.00 crores. This transaction significantly strengthened the company's capital position, with Tier-1 capital expected to rise to around 33% from 20%, while leverage is projected to reduce to nearly 3x.

Market Position and Outlook

As India's second-largest retail NBFC after Bajaj Finance, Shriram Finance operates across commercial vehicle financing, tractors, and passenger cars in both urban and rural markets. The company has received overwhelming positive analyst coverage, with 35 out of 38 analysts maintaining a 'buy' rating following the MUFG deal and credit rating upgrades.

The stronger credit profile positions Shriram Finance advantageously for accessing low-cost funding across various instruments, including fixed deposits, supporting its expansion strategy across lending segments and enhancing long-term growth prospects.